VAT (Value Added Tax) should not be a cost factor if two companies do business. However, the German tax auditors look very strictly at the VAT because the formalities are easier to check than complicated tax laws. As a consequence a lot of companies have to pay VAT just because they do not have correct incoming or outgoing invoices or because they did not check the VAT ID number of their business partner.

The VAT system within the European Union is very complicated. You would think that it should be simple because the European laws define the basic structure but it is the opposite. Every country defines the Europeans laws a little different. This might cause conflicts between you and your customers. Therefore, it is always the best to know how the invoices should look like before you pay your bills. Otherwise, your business partner might be too “lazy” to correct the false invoice.

You should also know that already very small practical differences will cause major tax law differences. For example: It is from a tax point of view a huge difference if your client will assign the carrier to pick up goods from another European country or if you assign the carrier.

Please find the details for VAT in Germany in the following articles:

1. VAT registration

2. VAT ID number

3. Federal Central Tax Register

4. Nob VAT entrepreneur

5. Advanced VAT returns

6. VAT deadline extension

7. Recapitulative (summary) statement

8. Tax rate

9. Import turnover tax

10. Customs

11. Destatis


Krischan TreydePlease contact me if I may give you further explanations.
I am looking forward to talk to you!

Best regards

Krischan (Kris) Treyde (CV)
Lawyer and Tax Consultant